Employers and small businesses will soon face a new filing deadline for Form W-2 reporting wages and Form 1099-MISC reporting non-employee compensation. This new deadline was enacted by the PATH Act of 2015 to help the IRS verify the legitimacy of tax refunds before issuing them.
Beginning with the 2016 forms (those filed in 2017), Form W-2 and Form 1099-MISC must be filed with the Social Security Administration and the IRS, respectively, by January 31, rather than the prior deadline of February 28 (March 31 if filing electronically). The new January 31 deadline applies regardless of whether the forms are filed on paper or electronically.
Copies must still be provided to employees and payees by January 31.
Also, beginning with the 2016 forms, only one 30-day extension to file Form W-2, which is not automatic, will be available. The IRS has stated they will grant the single 30-day extension to file Forms W-2 only in limited circumstances where the request for extension demonstrates that there were “extraordinary circumstances or catastrophe, such as a natural disaster or fire destroying the books and records needed for filing the forms.” Late filed returns may be subject to penalties starting at $50 per form.
Please be prepared to meet these new deadlines. Contact your Yeo & Yeo tax professional for assistance.